Long-Term Care Insurance Flashcards
Long-Term Care
Non-hospital, non-physician care that an elderly or disabled person needs for an extended period of time
LTC is often for…
90 days or more
LTC focuses on…
Custodial care, not skilled care
LTC policies will pay if person can’t perform…
2 activities of daily living
Activities of Daily Living
Bathing, dressing, eating, transferring, toileting, continence
Cognitive Impairment
Can trigger LTC benefits regardless of activities of daily living
Cognitive impairment must be diagnosed by…
Licensed physician
Respite Services
Relieve primary caregivers who monitor an LTC person at home
Adult Day Care
Provides care to LTC persons in a temporary group setting
Most modern LTC policies must pay for…
At least some respite/adult day care
LTC: Elimination Period
Period of time during which a person must receive LTC (and pay OOP) before policy benefits will start paying
LTC deductible is what type?
Time based. Often 30, 60, 90 days or more
LTC: Benefit Period
Amount of time the insurer will pay for LTC
LTC: Benefit period begins after…
Elimination Period
LTC: Benefit period might be extended if…
Insured hasn’t used up daily/monthly benefit limits
Underwriting
Must be reasonably healthy at time of application
Issue Age
Age at time of purchase
Attained Age
Premiums go up every year based on age
LTC pricing will usually be based on…
Issue Age
Issue-age policies can go up in price it…
It’s done to everyone in same rate class, not due to age or health
LTC Exclusions
War injuries; self-inflicted injuries; alcoholism or drug abuse; mental illness; care covered by other insurance or government; care needed after illegal acts; aviation accidents; pre-existing health conditions
What mental illnesses are covered by LTC?
Alzheimer’s and dementia
LTC doesn’t cover aviation accidents unless
Person is a passenger
LTC Inflation Protection
Optional feature that increases benefits based on inflation or other factors
Future Purchase Option
Lets policyholder buy more LTC insurance at a later date regardless of health
Extra coverage must be based on person’s…
Attained age and will cost more
Future purchase option must be exercised by a certain date and not when…
The person already needs LTC
Non-Forfeiture Options
Provide benefits to policyholders who cancel their smaller benefit limit
Non-forfeiture options are often…
Paid-up insurance for a shorter period of time or with a smaller benefit limit
LTC Qualified Plans
Limit benefit triggers to inability to perform 2 ADL’s and/or cognitive impairment
In general, qualified LTC plans provide…
Tax-free benefits
In general, a portion of qualified LTC premiums are…
Tax-deductible
Non-qualified LTC plans might have…
Negative tax consequences
LTC Partnership Plans
Special LTC policies that let someone qualify for MCD without having to spend down their assets
LTC partnership plan specifics differ by…
State
